There are two categories of purchases that you should always buy the best that you can afford.

  1. Purchases that will have a long term material impact on you life
  2. Purchases that cost far less than the value they provide

The first category of things that are worth spending a lot of money on are things that can be looked at more like investments. These are items or services that will pay for themselves overtime or even immediately. If you go cheap on these decisions, it will cost you long term, possibly for the rest of your life. A few examples are below:

  • Attorneys
  • Doctors
  • Insurance
  • Spouse

If you are in legal trouble, lets say you get a DUI, the attorney you hire can drastically change the rest of your life. If the attorney can give you proper counsel and possibly get the charge reduced from a criminal to a misdemeanor, it will likely be the difference between staying employed or being fired. If you are getting divorced, if you are going to hire an attorney (better to avoid attorneys completely if your spouse is as well) good advice will shape your financial future and possibly your family dynamic if you have kids. This isn’t the time to be cheap.

Skimping on your health will cost you down the road. When you are young and feel fine you will think you don’t need a doctor and most of the time you are probably right. If you go for regular physicals, 9/10 times there will be nothing wrong, but that tenth when they catch a disease early will change your life. Everybody ….. everybody gets sick eventually, make sure you are prepared. This also applies to eating healthy and exercise. If you have some disposable income, spend some of it on diet and exercise. This doesn’t mean you need to buy hundreds of dollar of supplements, just buy more vegetables and spend a few minutes a day exercising.

Everyone needs insurance. Make sure you and your assets are adequately covered. Most insurance companies today operate their insurance business at a loss, meaning most policyholders will on average receive more money in claims than they pay in premiums throughout their life. This is because insurance companies collect premiums, invest the money, then pay out claims and keep the interest from the investments as profit. For most people (middle & working class) insurance will protect you from expensives problems that will bankrupt you. If you can’t afford to fix your car after a crash or buy a new house when a hurricane strikes, you need insurance to cover you. Don’t let something completely out of your control bankrupt you. If you are wealthy, insurance protects you from liability. If people find out you have money, you need to be covered for lawsuits. If someone gets hurt on your property or gets hit buy your car, even if you aren’t at fault, you could get sued and lose everything.

A spouse isn’t a purchase but it’s certainly something that you don’t want to settle on or be cheap about. Spend time and money to get the best on that you can.

You are going to spend the rest of your life with this person and likely raise your children with them, make sure you chose the right one. Also don’t feel like marriage is the default. You don’t have to get married, if you aren’t sure it’s a lot better to wait and get married later than feel like you need to make an impulse decision.

The second category is purchases that provide far more value than what they cost. Some items, due to competition in the marketplace, are very cheap. These are things that are no-brainers and you will definitely get your money’s worth no matter how much you spend. Some examples are:

  • Mattress
  • Shoes
  • Computer/Phone

When I was in college I slept on a cheap mattress. I was broke when I bought it and went to the store and bought the cheapest one available. This was before you could order a nice mattress online for a few hundred dollars. A cheap spring mattress was several hundred dollars, a nice one was thousands. When I bought my first nice mattress it changed my life. I was comfortable in bed. I slept better. My girlfriend at the time didn’t hate sleeping over. I sleep on it every night and will continue too for several years. My current mattress is this foam mattress by Tuft & Needle that only cost about $600 online. I’ll potentially sleep on it close to 4,000 times over the next ten years. 4,000 x 30 minutes of extra sleep = 2,000 hours of sleep that I will get. It was worth every penny.

 

I have never had shoes that I liked that I didn’t get 10x the cost back in value. A nice pair of shoes that you like and are comfortable is worth thousands of dollars. Luckily you can get a pretty good pair for a couple hundred. Over the years I’ve noticed that regardless of how many shoes I own, I want to wear the some ones every day. So I quit buying multiples. Today I own two dress shoes, one black, one brown, one pair of running shoes, and two pair of casual shoes. The casual shoes are exactly the same shoe, one is more worn out, the other is newer and nicer for different occasions. They are all high end and will get worn every day for years. This is much cheaper and more comfortable than buying several cheaper shoes I don’t really like. My favorite dress shoes are these Johnston Murphy oxfords in black.

Get a nice computer. Life is too short to wait around for your computer to startup or for programs too load. 20 years ago computers were expensive and you couldn’t do very much with them. Today most people use one all day long and they cost very little considering the value they provide. I use my computer and phone for several hours every day and they last for 3–5 years. A mediocre laptop is $700, a top of the line one is $1,200. Right now I’m using the Google Pixelbook  and its the fastest computer I’ve ever had. Spend a little extra and make yourself happy. There are better ways to save $500.

I could list many more items that are worth spending money on but these are my favorite examples. You spend 1/3 sleeping, 1/2 your life wearing shoes, and up to 1/2 your life using a phone or computer. Don’t be cheap. For an extra $500 on your mattress, $500 on your shoes, and $500 on your computer you can life far more comfortably. It will be the best $1,500 you ever spent.

 

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